Adelaide Property Investment

The Adelaide property market may have finally started to trend upwards and show signs it may be in for a period of sustained steady growth in 2020. While Adelaide house price growth has been steady at one to two per cent there are individual property investment areas which had done better. These include Adelaide’s “millionaire suburbs” which have recorded major growth in their median house prices in past 12 months.

Uplift in the premium market is often an early signal of a strong market upcycle, “Kensington Park, St Georges, Henley Beach South, Hyde Park, and Hazelwood Park all have median prices above $1 million and have had median price growth of 20 per cent or more in the past year. Other upper-level suburbs like Glenunga, Norwood, Kensington Gardens and North Adelaide have had growth above 10 per cent.

However the growth is not confined to the top end, suburbs with growth above 10 per cent spread across all price ranges, including Blackwood (up 15 per cent to $575,000), Royal Park (up 14 per cent to $445,000) and Semaphore (up 12 per cent to $690,000). One precinct displaying good growth comprises the Glenelg suburbs, with Glenelg South up nine per cent to $1,390,000, Glenelg North up 12 per cent to $730,000 and Glenelg East up 21 per cent to $875,000.

This reconfirms the theory that outperforming areas can be found even when the overall market appears to be moderate.

Adelaide has experienced something of a recovery since then but hardly in the mould of a Sydney and Melbourne rampant price growth of the past 5 years and that’s the way it’s expected to continue to perform in 2020 – steadily, reliably and slowly.

Overview 2020 & Beyond

REISA present, Alexander Ouwens, says that while the market isn’t setting any records, it’s underpinning a large slice of the South Australian economy and should experience increased growth over the next 12 months. He says people have confidence in the Adelaide property market and in particular knowing their investment is a secure one.

“Property is definitely the favourite industry in South Australia and I’d expect growth of about five to six per cent across the Adelaide metropolitan market over the next 12 months,” Ouwens says.

“Auction clearance rates are now starting to slip into the 70 per cent range, which is positive, and we’re starting to see some real depth at the auctions.

With the Melbourne and Sydney property markets overheating and now starting to come off, we’re seeing more and more interstate and overseas buyers looking at Adelaide. It’s starting to head towards a sellers’ market and heading in the right direction.”

“The amount of listings has been down lately but the market is very stable. We haven’t had the same cross-market strength of Melbourne and Sydney over the past 12 months but it’s evening out to be quite a steady market. The price point in the inner-metro area of the second homeowners moving up is starting to mesh with the baby boomers looking to downsize, so there’s this crossover of markets taking place in that $600,000 to million-dollar bracket.”

According to the latest NAB Residential Property Survey, Adelaide property values could see further growth in the months ahead, with house prices expected to increase 1.7 per cent in 2020, the equal highest forecast growth with Hobart.

While the predicted growth is modest, it is still significantly ahead of the forecast average for combined capital cities, which are showing a drop of 0.1 per cent.

Adelaide is also up 0.2 per cent on the 1.5 per cent growth forecast last year

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Property Investor Planning

Australian Property Investor Planning is a property investment company specialising in helping investors to buy new real estate in Australian capital cities.
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